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Secondary copyright infringement
Background Today, a single individual, with very little investment, can reproduce and distribute millions of copies of works over the Internet, especially works that can be digitized easily, like music or motion pictures or photographs. In the United States, many companies have deployed peer-to-peer networking technology to take advantage of this fact, essentially enlisting millions of consumers into a network of copyright infringement on a scale never seen before. The fact that the activities of many individuals can cause massive, large-scale infringement raises serious questions about enforcement. It is quite difficult for copyright owners to identify, locate, and bring enforcement actions against the vast number of individuals who might be infringing their works. And even if the owners could bring such actions, it is unlikely that such individuals would be able to pay for the damage their actions have caused. In an effort to address efficiently the infringement in these circumstances, U.S. copyright owners have turned to doctrines of secondary liability to hold the facilitators of these networks liable for the infringement. These companies, such as the old Napster, Aimster, Grokster, Morpheus, and Kazaa, provided software and services to users, and earn advertising dollars based on the size of the audience the infringing activity attracts. Secondary liability doctrines Secondary liability doctrines have long been part of the U.S. common law of copyright. They provide an effective means of enforcement by placing liability on those who are benefiting from the infringement and are in a position to control or restrain it. These doctrines may play a much more important role in copyright in the future, as more and more technological developments permit companies to take advantage of individuals' infringing activity. The Copyright Act grants to copyright owners not only the right to exercise the exclusive rights under Section 106, but also the right "to authorize" the exercise of those rights. The inclusion of the right "to authorize" was "intended to avoid any questions as to the liability of contributory infringers" — those who do not directly exercise the copyright owner's rights, but "authorize" others to do so.See H.R. Rep. No. 1476, 94th Cong., 2d Sess. 55 (1976), at 61, reprinted in 1976 U.S.C.C.A.N. 5674. There must be a direct infringement upon which contributory infringement or vicarious liability is based. Other than the reference to a copyright owner's right "to authorize" the exercise of the exclusive rights, however, the Copyright Act does not mention or define contributory infringement or vicarious liability — the standards for which have developed through case law. For there to be secondary liability, there must be direct infringement.See Metro-Goldwyn-Mayer v. Grokster, 545 U.S. at 940(holding that "the inducement theory of course requires evidence of actual infringement by recipients of the device. . . ."); {Faulkner v. National Geographic|Faulkner v. National Geographic Enters., 409 F.3d 26, 40 (2d Cir. 2005) (holding that"there can be no contributory infringement absent actual infringement"); Matthew Bender & Co. v. West Publishing Co., 158 F.3d 693, 706 (2d Cir. 1998); 3 Melville B. Nimmer & David Nimmer, Nimmer on Copyright §12.04DI (2007). The various cases brought to date suggest the courts may be having trouble finding the appropriate standard for secondary liability in the digital age. In the United States, the prospect of secondary liability for copyright infringement traditionally was an important safeguard that discouraged businesses from using copyrighted works as a "draw" for customers without permission. This prospect of liability, however, had to be balanced by the courts with freedom to engage in largely unrelated areas of commerce. Sony-Betamax case The U.S. Supreme Court addressed these issues more than 20 years ago in the case of Sony Corp. of America v. Universal City Studios, Inc.''464 U.S. 417 (1984). Ever since then, this case has guided the courts in the proper application of the doctrine of contributory infringement. ''Sony involved the sale of the Betamax videocassette recorder, which purchasers used to "time-shift," that is, to record broadcast television programming for viewing at a later time. The Court found no contributory liability, saying that there would be no such liability as long as a product was capable of "commercially significant" or "substantial non-infringing uses." Since the Court found that the predominant use of the Betamax was non-infringing, it did not need to further clarify what it meant by "substantial non-infringing uses." However, the Court did acknowledge that copyright owners are entitled to effective, not "merely symbolic," copyright protection. MGM vs. Grokster Most recently, in MGM Studios, Inc. v. Grokster, Ltd.,''545 U.S. 913 (2005). the U.S. Supreme Court addressed whether the providers of peer-to-peer software could be held liable under secondary copyright liability theories. The Court ruled unanimously that such providers could be held liable if they "distribute a device with the object of promoting its use to infringe copyright, as shown by clear expression or other affirmative steps taken to foster infringement." In other words, if a technology provider induces its customers to infringe copyrights, it can be held liable for that infringement. The Court instructed lower courts to examine all the facts and circumstances to determine whether such inducement took place, and held that the rule in the ''Sony case does not prevent liability where the defendant has been found to have induced infringement. This rule probably will allow copyright owners to obtain effective enforcement of their copyrights against software and service providers who seek to encourage and profit from copyright infringement. International copyright law As an international matter, there is little uniformity among national laws as to secondary liability, whether it be liability for a company that uses peer-to-peer technology to encourage infringement, or, as the United States addressed in Title II of the DMCA, an Internet service provider that provides facilities used by others to infringe. This may be an area that warrants examination concerning international standards for such liability, especially given the global nature of the Internet, where a company can set up an infringement-facilitating operation that serves customers throughout the world from one country. Maintaining effective protection for copyright in the digital age might require such international standards. References Category:Copyright